Two weeks after canning CEO Carol Bartz, Yahoo’s board has not yet begun looking for a replacement, say sources.
Specifically, the board has not yet hired a search firm to look for a new CEO, which would be the first step in an official search.
Instead, the board has formed a “sub-committee” charged with exploring various transactions.
This sub-committee, sources say, has been reaching out to private-equity firms and media companies to solicit their interest in buying all or parts of the company.
At least three private equity firms are taking a serious look at buying Yahoo, says one industry source. Of these, Silver Lake may be the closest to making a serious offer. Hellman & Friedman is also said to be taking a look.
Any deal with a private-equity firm, an industry source cautioned, would be dependent on the explicit cooperation of Yahoo’s Asian partners, Alibaba and Softbank, which would be needed to spin off or otherwise monetise Yahoo’s Asian assets.
This morning it was revealed that Silver Lake is participating in a tender offer for $1.6 billion of stock in Alibaba Group. The source views this as a sign that Silver Lake is circling the wagons for a possible deal.
Meanwhile, Yahoo’s core business is viewed by both private-equity firms and the board as an unwanted stepchild.
“No one is interested in turning around Yahoo,” the industry source says.
Instead, the board sub-committee and private-equity firms are reaching out to various media companies to gauge their interest in buying all or part of the core business. Essentially, say two people familiar with these solicitations, Yahoo is asking what Yahoo assets the companies might be interested in and what they might be willing to pay for them.
In other words, Yahoo’s core business has become a sort of yard sale: See something you like–point and make an offer.
Among the companies contacted, say sources, are News Corp, Disney, and Glam Media.
Microsoft has also been mentioned as a likely party in a transaction.
The board’s focus could shift at any time, of course. If an attractive offer or deal for the company does not materialise, the board could then focus on hiring a new CEO and turning around the company. But, in the meantime, Yahoo’s core business is basically in purgatory.
The message one industry insider is getting from Yahoo’s board outreach is this:
“Anyone have any ideas? We don’t.”
And more specifically, the source says, the board’s message is this:
“Anyone with money have any ideas? Can they tell us what to do?”
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